Almost half of adult Americans have credit card debt. That’s over 120 million Americans. And you may be one of them. Now, you may be wondering “How long will it take to pay off my credit card?”, and you wouldn’t be the first to ask that. Let’s take a look at how to pay off your credit card faster, and spend less on interest.
Know How Much You Owe
First things first, you need to know how much you truly owe on your credit cards at this moment. Credit cards have interest added on whatever you owe each month, and will continue to grow, even if you don’t pay. So if you’ve just been paying the minimum, chances are that you haven’t even made a dent in your debt.
Check what you owe, write it down, and make a plan to pay it off within a certain amount of time. That brings us to step two.
Put A Plan In Place
One of the best ways to pay off credit card debt is to have a plan to pay it off. You can use this debt payoff calculator to see how fast you can pay off your credit card debt. You’ll also be able to organize it if you have multiple credit cards with different interest rates.
Keep in mind that it’s usually better to pay off the credit card with the highest interest rate first, because that could help you save the most money in the long run. But if you’re looking for quick wins and motivation, you can start with your lowest balance and work your way up.
If you just have one credit card, but a higher balance, you can move on to step three.
Add In Extra (When You Can)
The best way to pay off credit card debt fast? Put as much money as you can towards it. This includes bonuses, side hustle money, raises, and more. You may also want to cut out unnecessary expenses (like eating out) so you can throw that money towards your credit card too.
I know how miserable it feels to throw every last cent you can at debt. But, if you’re diligent, and make a plan to stay out of credit card debt, this small sacrifice is worth it. A few months or years of paying off credit card debt is better than being in credit card debt your whole life (just imagine how much money you’d be wasting!).
Negotiate Your Rate
Once you start paying off your credit card, you may be able to call and negotiate your rate. Banks like a gesture of “good faith”, and they’re more likely to lower your rate if they see you trying to pay off your debt.
When you’re negotiating, don’t be rude or condescending. Just call, let them know that you’ve been keeping up with payments, but that it would be really helpful if the rate was lowered so you can continue on your debt payoff journey. It is completely possible to negotiate for a lower rate, and people do it all the time!
Get A Better Credit Card
If you aren’t able to negotiate your rate, another option would be to transfer your debt to a better credit card. This usually costs some money up front (via a transfer fee) but can be worth it if your current credit card has a high interest rate.
For example, if you still owe $10,000 on a credit card at 22% interest rate, and you transfer that to a credit card with 0% interest rate for 18 months, you could save up to $3,000 in 18 months (if you are able to pay off the $10,000 in that time)! That’s a big savings.
Again, this will require a bit more work on your part. First, you’ll need to make sure you qualify for the new card (which may require a certain credit score). And, you’ll need to make sure that you can really pay off the card during the introductory period, or be able to transfer the balance if you can’t.
But if you’re willing to take the risk to lower your interest rate and pay off your credit card faster, it’s worth a try.
Get A Personal Loan
Another option would be to get a personal loan. These usually have lower interest rates than credit cards, which means you’ll be able to pay it off slightly faster.
Just keep in mind that getting a personal loan will be another hit to your credit, and can lower your score significantly before you start paying it off. This is a small sacrifice if you’re planning to be debt free, but can affect other parts of your life should anything happen (like needing a new car). I highly suggest trying to increase your credit score before going this route, so the hit doesn’t hurt as much.
Close Your Credit Cards
Of course, the best way to get out of credit card debt and stay out is to cancel or close your credit cards once they’re paid off.
Now, don’t get me wrong, I’m not Dave Ramsey. I think credit cards can and do work, but only IF you know how to have self-control and work the system. Credit cards are not worth it if you’re constantly finding yourself in debt because of them.
So, if you think that you won’t be able to control your spending habits, go ahead and close those cards. Yes, it will affect your credit score in the short run, but that’s better than constantly getting into credit card debt. When you think you have more self control, you can always try and apply to a new credit card later.
How Long Will It Take To Pay Off My Credit Card?
So, how long will it take you to pay off your credit card? That answer will depend on how much credit card debt you have, how much extra money you have to throw at it, and how you plan out your payments. But, with these tips, you can pay off your credit card much faster. And who wouldn’t love that?
AUTHOR Kimberly Studdard
Kim Studdard is a project manager for online entrepreneurs and small businesses. When she isn't spending time with her daughter and husband, or reading her growing pile of horror books, you'll find her working on her HR degree and working towards FIRE.